NEW DELHI: India is not alone in raising the bar for granting patents on pharmaceutical products. Australia, having reviewed pharma patents, has questioned the benefit of allowing patent extension beyond 20 years and is looking to tighten patent standards which have been found to be “less than rigorous” in the past. The draft report of Australia’s pharmaceutical patents review released recently also raised doubts about Australia necessarily getting more R&D investments from giving patent extensions.

While Novartis and the Big Pharma have threatened that they would not make R&D investment in India because of inadequate patent protection, the Australian review panel says: “It is difficult to see why a pharmaceutical firm would choose to conduct R&D in Australia, merely because the government decided to offer an extension of (patent) term here.” The panel report noted that it was fundamental issues such as relative costs of R&D and skill availability which influenced the location of R&D spending.

The report recommended that the current model of using the patents system to subsidise pharmaceutical R&D indirectly through patent extensions should be replaced with a direct subsidy. It observed that direct subsidy also had an additional benefit because it could be directed towards investment in pharmaceuticals which were not well addressed by the patent scheme, such as too little research for newer antibiotics, pharmaceuticals to address rare diseases, paediatric illnesses and endemic health issues in low income countries.

After 2005 India started granting product patents on medicines. However, Section S

ection 3(d), one of the safeguards introduced by Parliament, seeks to prevent patenting of new forms of known substances unless they exhibit enhanced efficacy. Were it not for section 3(d), the standards for grant of product patents on medicines in India would be lower, almost identical to the standards in countries such as the United States andEuropean Union, where a large number of patents are granted on minor modifications of a single medicine.

Section 3(d), along with other safeguards such as allowing patent oppositions by public interest groups, has been used as one of the grounds to successfully challenge patents for minor modifications of several antiretroviral (ARV) medicines used to treat people living with HIV.Section 3(d) also became the basis for the refusal of a patent toNovartis for the beta-crystalline form of imatinib mesylate, a drug used to treat chronic myeloid leukemia (CML), a type of blood cancer. In 1998, Novartis filed a patent application in India for this medicine. In 2005, the Chennai Patent office heard patent oppositions to this application including one filed by the Cancer Patients Aid Association (CPAA). The CPAA challenge was spurred by great concern over the price Novartis set for its version of the drug (sold as Gleevec) at Rs 1,20,000 ($2,400) per month as against the generic versions that were available at a cost of around Rs 8,000 to Rs 12,000 per month.

In 2006, the Patent Office rejected Novartis’ patent application on several grounds, including section 3(d). Novartis immediately challenged the constitutional validity of Section 3(d) before the Madras High Court arguing that the term “efficacy” was vague. In 2007, dismissing the challenge, the Madras High Court held that the word “efficacy” had a definite meaning in the pharmaceutical field, i.e. therapeutic efficacy. In 2009, the Intellectual Property Appellate Board (IPAB) rejected Novartis appeal against the patent application rejection on the ground that it did not satisfy section 3(d). Novartis then approached the Supreme Court asking for a liberal interpretation of section 3(d) that would allow it to get a patent on imatinib mesylate.

Novartis tried to argue that the physico-chemical properties of the polymorph form of the imatinib molecule, i.e. better flow properties, better thermodynamic stability and lower hygroscopicity, resulted in improved efficacy. The Supreme Court firmly rejected this contention holding that in the case of medicines, efficacy means “therapeutic efficacy” and these properties while they may be beneficial to some patients do not meet this standard. The Supreme Court also held that patent applicants must prove the increase in therapeutic efficacy based on research data in vivo in animals.

Eight years after India’s patent law was amended, the Supreme Court decision has firmly established the legality and validity of Section 3(d) and has lain to rest the controversy raked up around the section by the pharmaceutical industry. The Commerce Minister has said that India’s law is fully in compliance with the TRIPS Agreement. However, on April 15, commerce minister Anand Sharma travels to Brussels to potentially sign the EU-India FTA that threatens to impose on India obligations far in excess of the TRIPS Agreement; obligations known to undermine generic production and access to medicines.

The Indian Parliament has balanced India’s obligations under TRIPS with the right to health through Section 3(d). The Supreme Court has unequivocally interpreted the true intention and spirit of this provision. It behooves the Indian government to respect the Parliament and the Supreme Court and ensure that it does not sign away these hard fought victories by health and public interest groups in trade negotiations.

In its ruling, the apex court said that Novartis’s “application for patent on the beta-crystalline salt does not meet any standard of novelty or inventiveness”, and therefore the company cannot be given any patent for this drug.

Shares of Novartis India Ltd fell as much as 7% after the Supreme Court judgement. The stock later recovered a bit to trade at Rs.577, down 3.64%, at 11:18am.

The judgement has provided clarity on the so-called evergreening and incremental innovation by pharmaceutical companies in order to retain patents.

Reacting to the ruling, Anand Grover, senior counsel appearing for Cancer Aid Patients Society, said: “It is a very good day for cancer patients. We are very happy. It is a myth spread by the company that judgement will affect research and development expenditures by companies—these companies want to make money without innovation.”

“The court noted that the product—beta crystalline—was known prior to 1995 through an earlier patent Novartis held. The implication of the judgement is that the Indian provision has been completely upheld and patents would be granted only for genuine inventions and litigative patenting will not be allowed,” said Pratibha Singh, an intellectual property lawyer who appeared for Cipla.

The ruling has been keenly followed across the world by pharmaceutical companies, humanitarian aid organizations and generic drug manufacturers as it will have far reaching implications on access to life-saving essential drugs under patents.

After a series of decisions that have gone against the big drug makers with respect to intellectual property rights in the past year, Paul Herrling, Novartis’s head of tropical disease research had said on Wednesday that the company is prepared for a negative response.

The case over patents for Glivec—a blockbuster anti-cancer drug made by Novartis—reached the courts when India denied patent for it in 2006 as the drug wasn’t considered a new molecule, but an altered version of one that had already been in the market for around 15 years. Basel-based Novartis had challenged the rejection of its patent application for Glivec by the Indian patent office and subsequently by the Intellectual Property Appellate Board.

Further, the company had challenged India’s interpretation of section 3 (d), which relates to what constitutes a new molecule, essentially to ensure that companies to not extend patents by simply modifying an already existing drug without any consequent changes in therapeutic effects.

The Department of Pharmaceuticals, Ministry of Commerce has just released a report by a committee set up to examine the issue of price negotiations for patented drugs. Comments are being invited from stakeholders.

The Campaign for Access to Affordable Trastuzumab is shocked that the Department of Pharmaceuticals is even considering the option of negotiating with multinational pharma companies for price discounts.

We note with concern that this report comes at a time when the Ministry of Health is actively exploring options such as compulsory licensing for bringing down prices of life-saving patented drugs through allowing market competition by generics and biosimilars. Trastuzumab is one of the drugs being considered for compulsory licensing.

This ill-timed move by the Department of Pharmaceuticals will benefit none other than big pharma companies whose patents on life-saving drugs are the main barrier in access to health for millions of Indians.

Global experience shows clearly that measures such as negotiated price reductions and “managed competition” through voluntary licenses (which usually incorporate stringent conditions to protect the interests of the originator company) do not result in any significant expansion of access, since prices continue to remain beyond the reach of most citizens.

A case in point is Brazil, which tried to use price negotiations with multi-national pharmaceutical companies to bring down the price of patented HIV drugs. As a result, the price of Efiverenz (Merck) came down to USD760 per person per year in 2003. In contrast, when Efiverenz was brought under compulsory license in 2007, the price came down to USD170 per person per year – less than one fourth the negotiated price.

Similarly, a World Bank supported process of negotiated price decreases in Central America and the Caribbean in 2002 brought prices of HIV drugs down to USD 1100-1600 per patient per year. In contrast, 10 Latin American countries independently adopted an open competition-based model involving both generic manufacturers and originator companies, resulting in prices coming down from USD 5000 to USD 400 per patient per year.

The Government of Thailand, which began issuing compulsory licences in 2007, considered and dropped the option of negotiated price reductions, noting that “Prior negotiation with the patent holders is not an effective measure and only delays the improvement in access to
patented essential medicines and puts more lives in less healthy or
even dangerous situations.”

India plays a key role as a supplier of affordable medicines to other countries in the global south. Unlike negotiated prices, which apart from being unacceptably high would apply only in India, compulsory licensing of a drug like Trastuzumab would benefit millions of people across the developing world through global marketing of cheap generic versions.

The Campaign for Affordable Trastuzumab urges the Government of India to follow through on the strong political will it has shown by initiating the process of compulsory licensing for Trastuzumab. With 25,000 new cases of HER2+ breast cancer being recorded every year with most patients being young women, there is no time to waste. We look forward to a speedy notification and an accelerated process to bring biosimilars of Trastuzumab into the market.

We call on our policy-makers to ensure that big pharma companies do not continue to hold our health hostage to their greed for profits.

Canada’s top court has ruled that Pfizer’s patent on their groundbreaking erectile dysfunction drug Viagra won’t be valid for much longer. The unanimous decision opens the door to the production of a generic version of Viagra in the near future.

The patent system is based on a “bargain”, or quid pro quo: the inventor is granted exclusive rights in a new and useful invention for a limited period in exchange for disclosure of the invention so that society can benefit from this knowledge. This is the basic policy rationale underlying the Act. The patent bargain encourages innovation and advances science and technology.

Disclosure is therefore a crucial part of the patent bargain.

The court clarifies that this involves not only a description of the invention and how it works, but rather a much more practical level of disclosure “to enable a person skilled in the art or the field of the invention to produce it using only the instructions contained in the disclosure.” In this case, the court finds that Pfizer failed to provide sufficient disclosure, concluding:the public’s right to proper disclosure was denied in this case, since the claims ended with two individually claimed compounds, thereby obscuring the true invention. The disclosure failed to state in clear terms what the invention was. Pfizer gained a benefit from the Act – exclusive monopoly rights – while withholding disclosure in spite of its disclosure obligations under the Act. As a matter of policy and sound statutory interpretation, patentees cannot be allowed to “game” the system in this way.

Pfizer argued strenuously that this should not result in invalidating the patent, but Justice Lebel, writing for the court, found no other alternative. The Viagra patent is therefore voided in Canada (which will allow for generic substitutes) and the importance of the basic foundation of patent policy for the broader benefit of society reaffirmed.

Today, the Bench of Intellectual Property Appellate Board, comprising Justice Prabha Sridevan (Chairperson) and Mr DPS Parmar (Technical Member), set aside the first ever product patent on a medicine granted in India to Roche for Pegasys (a medicine used to treat Hepatitis C) on an appeal filed by a patients’ group.

In 2005, to comply with its international trade obligations, India re-introduced a system of granting product patents on medicines. In 1970, it had changed its patent law to disallow such patents precisely because they had resulted in high prices of medicines in India. This was the first product patent granted under the amended 2005 patent law.

As you know, a product patent on a medicine allows the patentee to prevent others from making or selling the medicine. This means that the patentee is able to set monopolistic prices. In the case of Pegasys, Roche charges approximately INR 4,36,000 for a course of six-months’ treatment. There may also be a relapse in which case the treatment course will have to repeated.

The Indian patent law provides for several tiers of protection to ensure that only genuine inventions are protected by patents. For instance, it allows “any person” to file an opposition challenging its grant. This could prevent a patent from being wrongfully granted in the first place. If a patent is granted, it can still be challenged by a “person interested” in a post-grant opposition or in a revocation proceeding.

The order delivered by Justice Prabha Sridevan is important for several reasons.

Sankalp, a patients’ group, had filed a post-grant opposition, which was rejected by the Patent Office. In the appeal filed by Sankalp before the IPAB, Roche sought to place a narrow interpretation on who a “person interested” could be. It argued that Sankalp is not a “person interested” because it was not a business competitor or a researcher. This issue probably arose for the first time before the IPAB. Rejecting Roche’s contentions, the IPAB held that a patients’ group that is a “person interested” in whether a patent is revoked or not. Justice Sridevan noted that the revocation of a patent could bring down the costs of the medicine as well as increase supply. She also held that public interest is persistently present in intellectual property law.

On the merits, the IPAB revoked the patent on the ground that Roche’s claim of combining interferon (a protein known to treat Hepatitis C) with an inert PEG structure using conventional methods to obtain predictable results was obvious to a person skilled in the art. The IPAB also held that Roche did not show that this pegylated interferon showed enhanced efficacy over other known pegylated interferons — a requirement under section 3(d) of India’s patent law.

By setting aside the patent , this order now paves the way for Indian companies that may decide to launch biosimilars of this medicine in India.

PRESS RELEASE

2 November 2012, New Delhi.

In a landmark victory for patients’ groups fighting against patents to ensure access to medicines, the bench of the Intellectual Property Appellate Board (IPAB) comprising Justice Prabha Sridevan (Chairperson) and Mr. D. P. S. Parmar (Technical Member), has revoked a patent granted in India to F. Hoffmann-La Roche AG (Roche) for pegylated interferon alfa-2a (Pegasys, a medicine used to treat Hepatitis C) as well as held that a patients’ group can challenge the validity of granted patents.

Mr. Eldred Tellis, Director of Sankalp Rehabilitation Trust, who had challenged the patent, said, “We hope that the absence of patent barrier will spur generic competition to bring down the price of this much-needed drug for those suffering from Hepatitis C. We also hope that the Government will now take concrete steps to start providing access to this medicine. It is unacceptable that people are dying due to Hepatitis C because they cannot afford to buy the medicine.”

As may be recalled, this patent granted to Roche in 2006 was the first product patent on a medicine in India under the new TRIPS-mandated product patent regime for medicines. The patent granted a monopoly to Roche to market pegylated interferon alfa2a. Patients with chronic Hepatitis C, who need a six-month course of treatment of Roche’s pegylated interferon alfa2a, have to purchase it at a cost of approximately INR 4,36,000 [USD 8,752.38] (available at a discounted price of INR 3,14,496 or USD 6,313.28). Again, it has to be taken in combination with ribavarin, which alone costs INR 47,160 [USD 946.70].

Concerned about the impact of this patent on access to medicines, Sankalp—an organisation that provides treatment and rehabilitation support for injecting drug users—filed a post-grant opposition challenging the grant of the patent with technical and legal aid from Lawyers Collective HIV/AIDS Unit.

Mr Anand Grover, senior counsel and Director of Lawyers Collective HIV/AIDS Unit, who appeared for Sankalp in this matter, said, “This victory will facilitate early entry of generics which is likely to lower the prices. If this happens, millions suffering from Hepatitis C, both in India and globally, will benefit. It is also historic because this was the first ever product patent granted on a medicine in India since 1970.”

Hepatitis C represents a huge public health problem in India and globally. An estimated 10–12 million people in India, including 50% of IDUs nationally and 90% of IDUs in the northeast, are infected with the Hepatitis C virus (HCV). Left untreated, Hepatitis C can lead to liver cirrhosis, liver cancer or liver failure. Hepatitis C is especially of concern for those co-infected with HIV, as several studies have shown that HIV-HCV co-infection leads to increased rates of disease progression. Injecting drug users are especially vulnerable to HIV-HCV co-infection with HIV-HCV co-infection rates as high as 93% among IDUs in Manipur. However, unlike both first- and second-line HIV treatment, which is available to all people living with HIV who need it, Hepatitis C treatment is not available in government hospitals largely due to its high cost and treatment programmes do not even bother to screen patients for HCV due to the unavailability of treatment.

Despite Sankalp’s case that Roche’s clams did not satisfy the patentability requirements under Indian law, in 2009, the Patent Office rejected the post-grant oppositions filed by Sankalp and an Indian company and upheld the validity of Roche’s patent. Sankalp then filed an appeal before the IPAB challenging this decision.

Before the IPAB, Roche also challenged Sankalp’s standing to file the post-grant opposition as well as the appeal. Roche argued that because Sankalp was not a business competitor or a researcher in the sector, it could not have challenged its patent at all. Sankalp argued that its members were directly affected by Hepatitis C as well as that it represented a community of drug users who are particularly at risk to Hepatitis C. The IPAB observed that “public interest is a persistent presence in intellectual property law” and also held that it was against public interest to “allow unworthy patents to be on the Register”. Holding that “the appellant who works for the community which needs the medicine, is definitely ‘a person interested’”, the IPAB noted that a successful challenge would “break the monopoly” and “bring the drug within reach of the community for whom it works, not only by reduction in cost, but also because of increase in supply”.

Mr. Grover said, “We are happy that the IPAB has recognised the element of public interest in setting aside undeserving patents and held that patients’ groups, who are directly impacted by patents on medicines, can challenge granted patents. This will be of import as concerned patients’ groups will now have better clarity in challenging patents on medicines for HIV, cancer and other diseases.”

Setting aside the patent, the IPAB held that Roche’s pegylated interferon was obvious to a person skilled in the art. It also found that Roche has not provided any evidence, in the specification or even otherwise, to prove that pegylated interferon has enhanced efficacy. The IPAB, however, held that Roche’s claims were novel.

Welcoming the findings on obviousness and section 3(d), Mr. Grover said, “The IPAB has rightly observed that the patentee used conventional methods to pegylate interferon and obtained predictable results, thereby rendering it obvious to a person skilled in the art. It also correctly held that the patentee has failed to satisfy the requirement of section 3(d) of showing enhanced efficacy. We hope that the Patent Offices too follow these standards while deciding pre- and post-grant oppositions.”

The text of the order can be accessed at the website of the IPAB. We will upload a copy of the official certified copy on our website as soon as we receive it.